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Answer: 1.0515/1.0533
## Explanation To calculate the EUR/CHF cross rate from the given quotes: We have: - EUR/USD: 0.9490/0.9503 (EUR per USD) - CHF/USD: 0.9022/0.9025 (CHF per USD) To get EUR/CHF (EUR per CHF), we use: EUR/CHF = (EUR/USD) / (CHF/USD) **Bid rate (EUR/CHF):** Use the bid for EUR/USD and ask for CHF/USD Bid = 0.9490 / 0.9025 = 1.0515 **Ask rate (EUR/CHF):** Use the ask for EUR/USD and bid for CHF/USD Ask = 0.9503 / 0.9022 = 1.0533 Therefore, the implied EUR/CHF cross rate is: **1.0515/1.0533** This matches option B exactly.
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Note: EUR/USD is the amount of EUR per 1 USD. CHF/USD is the amount of CHF per 1 USD.
The bid-offer on the EUR/CHF cross rate implied by the interbank market is closest to:
A
0.8562/0.8576
B
1.0515/1.0533
C
1.0519/1.0529
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